IT Outstaffing company vs IT Recruitment agency

22.10.20 4 min to read

When you cover your development capacities OR when you need to find / add development resources, you go through a particular path. Two paths that you may go on for support are IT outstaffing and IT recruitment. So what’s the difference between the two?

While recruiting developers seems like the easy route to getting your project done, other options like staff augmentation are more profitable for the business because it takes care of all the difficulties with hiring, checking skills, adapting employees. Consider staff augmentation’s core benefits before you hire or outsource your project.

IT Staff augmentation

The Outstaffing model involves hiring a team of web developers, testers, or other specialists, which are provided for a client’s specific project or task. IT outstaffing fits startups and businesses that already have in-house development teams but still need extra resources (developers, designers, QAs, DevOps, architects, etc.) to complete tasks they can’t handle themselves or those who lack the technical knowledge and need a support or cannot find resources OR those who need a support.

With the staff augmentation model, you have the opportunity to personally choose the candidates and manage them with the methods you prefer. Basically, the vendor takes overall organizational and administrative hassles, while you get the opportunity to deal with your core responsibilities and collaborate with your augmented team the same way you do with your in-house developers.

IT Outstaffing is a good choice if you:

  • need to hire a team of some professionals, but it’s impossible due to the shortage on your local talent market.
  • realize that local recruitment will take too long
  • looking to extend your search to other locations, because the stack of professionals that you intend to hire is rare in your country
  • want to communicate with your team directly on a daily basis and wish to be well-acquainted with your remote programmers to make sure they feel like part of your local team.
  • don’t want to do all the organizational work, keep track of retention, etc.

Recruitment agencies

There are also many recruitment agencies on the market. It may also be considered as a retained search. They typically charge a percentage of the hire’s salary as a free placement. Those agencies then collect resumes, interview, vet, and eventually receive the client’s approval for a hire, at which point the agency has finished its job.

What obstacles you might encounter
– a shortage of qualified developers actively looking for positions will affect the timeframe of getting your project developed.
– when onboarding new hires, the potential for a long training period can hit you, developers with little to no experience need training in your technologies and resources. Considering this, new developer might cause the delay in delivery and the one who is responsible for their training might also need to spend additional working time

Per Forbes, the tech industry has the highest turnover rate of any other industry. Tech giants like Amazon have a turnover time of 1 year on average. Google has a slightly better timeframe of 1.1 years. With tech giants having such short retention times, smaller companies can’t remain competitive to keep qualified talent. If it costs $50,000 to hire a developer, over 10 years it could add up to $500,000 with a 1-year turnover.

IT Outstaffing company vs IT Recruitment agency

The difference between a recruiting agency and staff augmentation is that recruiting involves acquiring talent to ultimately hire a full-time employee. The key difference is who will manage the employees, bear the costs of them, handle the retention, etc. In outstaffing, the client has provided a need and the outstaffing company is engaged in it, and in recruiting, they perform all these tasks themselves.

The main advantages of recruitment by IT Staff Augmentation Company are:

  • manage all process of hiring, adopting, and developing
  • seeing a potential employee in action before making the commitment to hiring them.
  • no need to worry about work environment and hardware, cause all these parts are provided by the agency
  • IT Staff Augmentation Company is able to get a number of employees quickly, bypassing the 4-6 weeks hiring usually takes, while a recruiting agency will spend up to half a year.
  • team extension companies always have CTO who keeps a track of the whole technological part and development. Moreover, such companies have a lot of developers working on different teams and projects, which allows the developers working on your project ask the questions and get an advice about issues or technical nuances.

If you want to consult about a Staff Augmentation or team extension, feel free to contact us. We have specialists with expertise in all relevant IT niches of software and web development.

Learn more about IT Outstaffing